Wow… how kick-ass would this be?! Other than the obvious movie licensing quagmire, they’d have to figure out the technology behind it. Series2 units only handle MPEG2, though the new Series3 also supports AVC. If Amazon movie downloads were to be offered on the S2, they’d have to change both the video format and DRM mechanism. Perhaps TiVo’s partnership with BrightCove (which they’re using to deliver NY Times content) provides some of the answers.

Business Week writes: Seattle-based Internet retailer Amazon, which recently launched a digital video downloading service aimed at taking on Apple’s Computer Inc.’s iTunes service, is talking with TiVo about a deal that “could be a key step toward bridging the gap between the home computer and the television set,” the New York Post reported Friday, citing two sources familiar with the discussions.